The project development and finance practice group of Pinheiro Guimarães is made up of a team of professionals having broad experience and up-to-date knowledge and understanding of the development and financing of projects in general. The firm provides legal support especially to its clients undertaking infrastructure and industrial projects, covering such fields as the energy sector, telecommunications, petroleum and natural gas, highways, railroads, ports, airports and industrial plants.
The firm counsels and accompanies its clients through all phases of a project – from the initial structuring to the conclusion and, thereafter, through to the project becoming commercially operational.
At the start of a project, the firm’s principal focus is to assist its client in defining the most appropriate structure from the corporate, regulatory and tax points of view. Subsequently, Pinheiro Guimarães provides continuing legal support in crafting documentation to be entered into among partners and sponsors of the project, and in defining a course for tax planning that takes into consideration the availability of appropriate tax incentives. The firm’s practice group accompanies the client through an analysis of regulatory matters, providing guidance regarding the participation in auctions and interaction with governmental entities, agencies and regulators. The firm also assists the client in obtaining the environmental licenses and land rights necessary for carrying out the project.
Pinheiro Guimarães also renders full legal support to its clients in the negotiation and drafting of the initial documentation necessary for starting up the project, such as EPCs (Engineering, Procurement, and Construction) contracts, as well as unit pricing, cost-plus, and other hybrid structures for pricing the construction of the project.
The firm provides assistance to its clients in EPC-M (Engineering, Procurement, and Construction Management), alliance contracts, supply agreements and contracts for operation and maintenance.
That legal support extends to long-term offtake contracts, such as power purchase agreements (PPAs), and to take-or-pay contracts. That support also extends to claim management, complex negotiations and disputes in respect of the start-up of project operations.
With respect to project financing, Pinheiro Guimarães collaborates closely with the clients, both in structuring the project and in implementing its operations, through strategic approaches and tailor-made solutions compatible with the complexity and objectives of the project. The firm has ample capabilities to address the appropriate structure for any given project.
Depending on the client’s needs, any such structure may vary from classic forms of financing to sophisticated alternatives, such as the issuance in the local capital markets of project bonds, financial transactions with multilateral financial institutions and development finance institutions, blended finance structures, hybrid instruments, investment funds, subordinated debt and mezzanine finance.
The services of Pinheiro Guimarães in advocating on behalf of a client engaging in project finance include formulating a security package and elaborating an efficient allocation of risks among sponsors and financiers.
In this regard, the firm assists in the negotiation of financing and security agreements, intercreditor agreements, direct agreements (contracts between the project’s lenders and key project counterparties, granting lenders the right to step into those contracts in the event of a borrower default), account control agreements (agreements establishing lender control over the project’s bank accounts and governing the waterfall of priorities in which revenues are applied to costs, debt service, reserves, and sponsor distributions), and other related documents.
In addition, the firm provides robust legal support to its clients in observing requirements for complying with applicable environmental, social and governance directives as well as with obtaining all necessary registrations and approvals with the Central Bank of Brazil and other competent authorities.
